Gas plant delays hit Petrofac profits

DELAYS caused by bad weather at the Shetland gas plant have forced construction giant Petrofac to announce a profit warning, its second this year.

The FTSE 100 company has said it has lost 300 days working on the £800 million gas plant at Sullom Voe for French oil company Total.

Originally planned to open during the summer of 2014 after work started more than three years ago, the gas plant is now being forecast to start producing first gas early next year.

Petrofac has been forced to triple its workforce from 800 to 2,400 during the past year in a desperate bid to complete the gas plant as quickly as possible.

This week the company, which is the UK’s largest oil and gas engineering firm, suffered a 26 per cent drop in its share value to a five year low after revealing that it expected profits this year to reach £369.7 million.

The price of oil falling to around $80 a barrel has also dropped its profit forecast for 2015 to £3189.7 million.

Shetland North councillor Alastair Cooper said the delay would impact on the council’s income from the plant, which will be based on throughput once gas starts to flow.

He said: “I am not surprised the cost has escalated quite considerably, but I think they completely underestimated how much it would cost and I am vexed that they are behind schedule.”